We have had a fair bit of interest in the worry free investing portfolio in recent weeks (as found in the portfolios tab of VectorVest 7 for Australia). There have been a few questions about how the worry free investing portfolio has stacked up over certain time periods.
This got me looking into the performance of the worry free investing portfolio relative to market performance. I opted to benchmark the portfolio against the All Ordinaries and the ASX200 – 2 market indices which I believe are a fair reflection of the market.
Firstly, let’s look at the All Ordinaries compared to the worry free portfolio. The returns are calculated each year and tabulated to produce the cumulative results:
It was interesting to note how the Worry Free Investing portfolio made no trades in 2008 (where the All Ordinaries fell over 40%) and 2011 (with the All Ordinaries falling over 10%). This gives me confidence in what the portfolio is about – it is about keeping you out of the market pull backs and making the most of the rising market conditions. The portfolio averages less than 4 trades a year since 2007 – now that is worry free in my mind. One is not spending hours and days behind a computer making trades week in and week out.
So the question you may have: Will the worry free investing portfolio make me a big return each year? The short answer to that is no. This is not a get rich quick scheme. This is a portfolio that consistently applies strict fundamental, technical and market timing analysis along with risk money management rules, year in and year out. Over the last 9 years – the portfolio has produced healthy returns in excess of 9% pa on average (excluding dividends and franking credits). We will continue to track this portfolio in VectorVest so you can continue to see its performance.
To see more on the methodology applied to test the worry free portfolio and to see how it performed against the ASX200 (very similar to the All Ordinaries benchmark) – click on the link below to watch the video:
DISCLAIMER: PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. YOU SHOULD CONSULT WITH YOUR LEGAL, TAX, FINANCIAL, AND OTHER ADVISERS PRIOR TO MAKING AN INVESTMENT WITH VECTORVEST